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HMRC internal manual

Debt Management and Banking Manual

From
HM Revenue & Customs
Updated
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Corporation tax: Pursuit by debt technical office

General

When a case is referred to a local debt technical office on IDMS that office is responsible for all recovery action. It is important that there is no unnecessary delay in either the preliminary action or in the start of recovery proceedings. The most effective action must be taken at all stages.

All collectable amounts working locally for the same company at the same time are to be cross-referenced and worked together.

Both the collectable and the suspended amount will be included in the amount referred for local pursuit.

Checking the company record

As you will not be advised of all changes which may be made to a company’s record, it is vital that before taking any local action you thoroughly check the company’s record, in particular, the accounting period you are working.

Initial action

On receipt of an item on IDMS C/W CT New Business Work list you should review the case to establish

  • the business address
  • the filing and payment compliance history
  • Trading Status.

Pursuit status

A case for pursuit at the debt technical office will normally be presented on IDMS. The pursuit status will be:

  • LA-ENF where a further amount has become collectable or an overpayment has arisen on a previously cleared AP which was LA-ENF at the time
  • LA in all other cases.

Pursuit at the business address

It is important that pursuit takes place at the most suitable address where payment of the outstanding amount is most likely. This will be, in the majority of cases, the business address. The COTAX record can hold up to 3 different addresses

  • the registered office
  • a communication address
  • an agent’s address.

The business address is not always the same as the registered office.

Where a business address has not been recorded on COTAX you should always check for a PAYE record. If there is a PAYE record you should look for a business address and telephone number where recovery prospects may be better.

Where there is no PAYE record you should contact the assessing / compliance office to obtain the business address and telephone number.

Business address in another area

If you are aware that the company has a further address in another debt technical office’s area where recovery prospects are better, you should arrange transfer.

Debt technical offices should not transfer periods of responsibilities because IDMS only recognises one office (including Enforcement and Insolvency Services) as being responsible for all unpaid liabilities for a Head of Duty for a particular company.

Whenever practical, all arrears due from a company that are working locally should be transferred at the same time.

Trading Status

It is important that the trading status of the company is established. A company may have ceased trading and be in the process of being struck off, or it may be dormant. The status of the company may affect our approach, pursuit and enforcement of any debt.

Prioritising work

The higher debt manager in consultation with the Debt Management Group Office is to ensure that

  • cases are correctly selected and presented on IDMS
  • a priority post system is operated.

Where a case has a total collectable liability of £5,000 the responsible officer is to ensure that prompt action is taken with

  • incoming post
  • approaching the company by letter, telephone or personal call

and, where there is no satisfactory response

  • recovery locally or reference to Enforcement and Insolvency Services.

For pursuit of automatic penalties see DMBM552080.